—(1) Except as provided in this section or any other written law or any regulations made under section 130P, no security interest may be created in book-entry securities.

[22/93]

(2) A security interest in book-entry securities to secure the payment of a debt or liability may be created in favour of any depositor in the following manner:

(a)

by way of assignment, by an instrument of assignment in the prescribed form executed by the assignor; or

(b)

by way of charge, by an instrument of charge in the prescribed form executed by the chargor:

Provided that no security interest in any book-entry securities subsequent to any assignment or charge thereof may be created by the assignor or the chargor, as the case may be, in favour of any other person and any such assignment or charge shall be void.

[22/93]

(3) Upon receipt of the instrument of assignment, the Depository shall immediately, by way of an off-market transaction, transfer the book-entry securities to the assignee and thereafter notify the assignor and the assignee of the transfer in the prescribed manner.

[22/93]

(4) Upon receipt of the instrument of charge, the Depository shall immediately register the instrument in a register of charges maintained by the Depository and thereafter notify the chargor and the chargee in the prescribed manner.

[22/93]

(5) The register of charges shall not be open to inspection to any person other than the chargor or the chargee or their authorised representatives and except for the purpose of the performance of its duties or the exercise of its functions or when required to do by any court or under the provisions of any written law, the Depository shall not disclose to any unauthorised person any information contained in the register of charges.

[22/93]

(6) An assignment or a charge made in accordance with the provisions of this section, but not otherwise, shall have effect upon the Depository transferring the book-entry securities or endorsing the charge in the register of charges except that the instrument of assignment or charge shall not have any effect if on the date of receipt of such instrument, the number of book-entry securities in the account of the assignor or chargor is less than the number of book-entry securities specified in such instrument.

[22/93]

(7) The provisions of section 130D(1), (1A) and (2) shall apply to an assignment of book-entry securities made under this section.

[22/93; 5/2004]

(8) An assignee or a registered chargee of book-entry securities shall have the following powers:

(a)

a power, when the loan or liability has become due and payable, to sell the book-entry securities or any part thereof and in the case of a chargee he shall have the power to sell the book-entry securities or any part thereof in the name of and for and on behalf of the chargor; and

(b)

any other power which may be granted to him in writing by the assignor or chargor in relation to the book-entry securities provided that the Depository shall not be concerned with or affected by the exercise of any such power.

[22/93]

(9) Nothing in subsection (8) shall be construed as imposing on the Depository a duty to ascertain whether the power of sale has become exercisable or has been lawfully exercised by the assignee or chargee.

[22/93]

(10) No book-entry securities assigned by way of security or charged in accordance with the provisions of this section may be —

(a)

transferred by way of an off-market transaction to the assignor save upon the production of a duly executed re-assignment in the prescribed form; or

(b)

transferred by the chargor, by way of sale or otherwise, save upon the production of a duly executed discharge or charge in the prescribed form.

[22/93]

(11) Upon the sale by the assignee or the chargee in exercise of his power of sale of any book-entry securities assigned or charged in accordance with the provisions of this section, the assignee or the chargee shall immediately notify the Depository of the sale and the particulars of the book-entry securities sold by him, and the Depository shall —

(a)

in the case of the sale by the assignee, notify the assignor of the sale; and

(b)

in the case of the sale by the chargee, effect a transfer of the book-entry securities to the buyer in accordance with section 130G and notify the chargor of the transfer.

The provisions of sections 130I, 130J, 130L and 130M shall apply, with the necessary modifications, to a transfer effected pursuant to this section.

[22/93]

(12) Upon fulfilling his obligations under an assignment by way of security or a charge, the assignor or the chargor shall be entitled to obtain from the assignee or chargee a re-assignment or a discharge of charge, as the case may be, of the whole or part of the book-entry securities.

[22/93]

(13) A re-assignment or discharge of charge shall be effected by the Depository by transferring the book-entry securities to the assignor or cancelling the endorsement of charge in the register of charges and in the account of the chargor, as the case may be.

[22/93]

(14) Book-entry securities may be assigned by way of security by an assignee or charged in the prescribed form by a chargee to secure the payment of any debt or liability of the assignee or the chargee, as the case may be, in accordance with the provisions of this section provided that no book-entry security may be charged by a chargee subsequent to any sub-charge.

[22/93]

(15) All acts, powers and rights which might previously have been done or exercised by the chargee thereunder in relation to the book-entry securities may thereafter be done or exercised by the sub-chargee, and, except with the consent of the sub-chargee, shall not be done or exercised by the chargee thereunder during the currency of the sub-charge.

[22/93]

(16) Upon the sale by the sub-chargee in exercise of his power of sale of any book-entry securities in accordance with the provisions of this section, the provisions of subsection (11), in respect of a sale by a chargee, shall apply with the necessary modifications to the sale by the sub-chargee.

[22/93]

(17) Nothing in subsection (14) shall affect the rights or liabilities of the original assignor or chargor of the book-entry securities under subsections (12) and (13) and he shall be entitled to a re-assignment or discharge of charge from the assignee or chargee free from all subsequent security interests created without his consent upon satisfying his indebtedness or liability to the assignee or the chargee.

[22/93]

(18) The provisions of section 130H shall apply to relieve the Depository and its servants or agents of any liability in respect of any act done or omission made under this section as if references to “depositor” include references to “assignee”, “chargee” or “sub-chargee”, as the case may be.

[22/93]

(19) Nothing in this section shall affect the validity and operation of floating charges on book-entry securities created under the common law before or after 12th November 1993, but that the Depository shall not be required to recognise, even when having notice thereof, any equitable interest in any book-entry securities under a floating charge except the power of the chargee, upon the crystallisation of the floating charge, to sell the book-entry securities in the name of the chargor in accordance with the provisions of this section.

[22/93]

(20) Nothing in subsection (19) shall be construed as imposing on the Depository a duty to ascertain whether the power of sale pursuant to a floating charge has become exercisable or has been lawfully exercised.

[22/93]

(21) A stockbroker shall have a lien over unpaid book-entry securities purchased for the account of a customer which shall be enforceable by sale in accordance with and subject to the provisions of this section as if the same had been charged to him under this section except that the stockbroker shall not be obliged to notify the Depository of the sale or the particulars of the book-entry securities sold by him.

[22/93; S92/97]

(22) Any security interest on book-entry securities created before 12th November 1993 and subsisting or in force on that date shall continue to have effect as if that Act had not been enacted.